Parallel Trade - US Lawmakers allow imported prescriptions drugs

Table of Contents

Chapter 1. Executive Summary: Parallel Trade, Benefiting or Breaking the Pharma Industry?

Chapter 2. Parallel Trade in Global Pharmaceutical Industry

• 2.1 What is Parallel Trade?
• 2.2 Effects of Parallel Trade
  • 2.2.1 Innovation driving R&D
  • 2.2.2 Profitability
  • 2.2.3 Safety/Efficacy of Drugs
  • 2.2.4 Easier Access for Counterfeit Drugs
    • 2.2.4.1 Methods of Controlling Counterfeit Drugs

Chapter 3. Legal Aspects of Parallel Trade

• 3.1 Exhaustion of Rights
  • 3.1.1 National Exhaustion
  • 3.1.2 Regional Exhaustion
  • 3.1.3 International Exhaustion
    • 3.1.3.1 International Exhaustion and the Pharma Industry
• 3.2 Intellectual Property Rights
  • 3.2.1 TRIPS
    • 3.2.1.1 Controversy surrounding TRIPS
  • 3.2.2 Doha Development Round
  • 3.2.3 Pharmaceutical Patent Protection
• 3.3 Compulsory Licensing
  • 3.3.1 Pharma Companies and Compulsory Licensing

Chapter 4. Price is the Principal Driver of Parallel Trade

• 4.1 Pricing in Pharma
  • 4.1.1 Factors that Influence Pricing
• 4.2 Price Convergence
  • 4.2.1 Arbitrage
  • 4.2.2 The Impact of the Euro on Drug Prices
  • 4.2.3 Price Convergence - a weak argument
• 4.3 Price Differential
  • 4.3.1 Pricing is not the Only Factor in Determining the Parallel Trade Potential for a Drug
• 4.4 Pricing Control
  • 4.4.1 Governments Link to Price Control
  • 4.4.2 Parallel Trade is used as a Cost Containment Method
  • 4.4.3 Cost Containment Methods have had Limited Effects
  • 4.4.4 Price Controls May Affect Drug Launches
  • 4.4.5 Price Control affects Innovation
  • 4.4.5.1 Price Control Seen as Reason why Europe' s Drug Innovation Falls Behind
  • 4.4.6 Reference Pricing will Cause Drugs to be Priced Below the Market Line
  • 4.4.7 A Single European Price for Pharma Drugs is Unlikely
• 4.5 Price Limiting
  • 4.5.1 Price Sensitivity
    • 4.5.1.1 Inelastic Market
    • 4.5.1.2 Elastic Market
  • 4.5.2 Factors That Affect Price Sensitivity

Chapter 5. Parallel Trade in US and Canada

• 5.1 Regulations in the US and Canada
• 5.2 Medicare Act Reducing Reliance on Cheaper Drugs from Canada
• 5.3 Safe Drugs are Only Imported from Canada
• 5.4 FDA' s Approach to Personal Importation
• 5.5 The Future of Re-importation
  • 5.5.1 Bill Allowing Imported Drugs Clears Senate
  • 5.5.2 Effects of Allowing Reimportation in the US
• 5.6 Differences in Pricing between the US and Canada
• 5.7 Patented Drugs are Found to be Cheaper in Canada than in US
• 5.8 US Generic Drugs Cost Less than Canadian Drugs

Chapter 6. Parallel Trade in Europe

• 6.1 Parallel Trade Predominantly a European Activity
  • 6.1.1 Trade Activity in the EU
  • 6.1.2 EU Parallel Importation
• 6.2 Drug Prices in the EU
• 6.3 UK - One of the largest Importers of Parallel Trade
  • 6.3.1 The Method of Parallel Importing into the UK
  • 6.3.2 Regulation of UK Parallel Trade
  • 6.3.3 Does the NHS Really Benefit from Parallel Trade?
  • 6.3.4 UK Parallel Traders - Major Companies
• 6.4 Germany
  • 6.4.1 German Parallel Distributors
• 6.5 France
• 6.6 Spain
• 6.7 Sweden
  • 6.7.1 Parallel Distributors in Sweden
• 6.8 Norway
  • 6.8.1 Norwegian Parallel Importers
• 6.9 The Netherlands
• 6.10 Denmark
  • 6.10.1 Conditions for Parallel Import
• 6.11 Parallel Exporting Countries
• 6.12 GSK Wins Long Battle
• 6.13 EU Enlargement
• 6.14 Limitations to Growth

Chapter 7. The Role of the Internet in Parallel Trade

• 7.1 Internet Usage is Immense
• 7.2 Online Purchasing of Drugs
  • 7.2.1 The World Online Drugs Market will Increase steadily
  • 7.2.2 Benefits of Online Drug Sales
  • 7.2.3 Concerns of Online Drug Sales
  • 7.2.4 Consumers Point to Low Cost and Convenience as Reasons for Purchasing Drugs Online
  • 7.2.5 Online Pharmacies Differ in their Operations
• 7.3 Verified Internet Pharmacy Practice Sites (VIPPS)
  • 7.3.1 Certification of the VIPPS Programme
• 7.4 Regulations for International Sites
  • 7.4.1 US Regulations
  • 7.4.2 Australia
  • 7.4.3 Fiji
  • 7.4.4 India
  • 7.4.5 Israel
  • 7.4.6 New Zealand
  • 7.4.7 UK
• 7.5 Canadian Internet Pharmacies
  • 7.5.1 US Consumers Buying Less from Canadian Internet Pharmacies
• 7.6 Rogue Internet Pharmacies
  • 7.6.1 UN Issues Warning About Rogue Internet Pharmacies
  • 7.6.2 Continuing Challenges Faced in Counteracting Illegal Internet Pharmacies
• 7.7 Operation Cyber Chase - A Year Long Investigation
• 7.8 Online Pharmacies: Good or Bad?

Chapter 8. Counterfeiting is a Major Threat

• 8.1 An Immense Concern Due to Counterfeiting
• 8.2 Prevalence of Counterfeiting
  • 8.2.1 Counterfeiting Incidents in Europe
• 8.3 PSI - Will it help?
• 8.4 Global Reports of Counterfeit Medicines
• 8.5 Counterfeit Lipitor Dispersed through the UK Supply Chain

Chapter 9. The Issue of Repackaging

• 9.1 The Repackaging of Pharmaceuticals is an Important Aspect of Parallel Trade
• 9.2 Different Types of Packaging
• 9.3 What a Package Must Do
• 9.4 The EU Angle on Repackaging
• 9.5 FDA' s Approach to Repackaging
• 9.6 Legal Case of Repackaging
  • 9.6.1 Advocate General' s Opinion on EU Repackaging of Pharmaceutical Products
  • 9.6.2 Background to the Case
  • 9.6.3 Advocate General' s Main Conclusions
    • 9.6.3.1 Overstickering
    • 9.6.3.2 The Necessity Condition
    • 9.6.3.3 Damage
    • 9.6.3.4 Notice
    • 9.6.3.5 Burden of Proof
  • 9.6.4 Impact of Such a Legal Case
• 9.7 Repackaging Affects Quality

Chapter 10. Arguments for Parallel Trade

• 10.1 York Study Did Show Healthcare Costs to be Reduced by Small Amounts
• 10.2 Swedish Study Confirms Price Competitiveness in Parallel Trading of Drugs
• 10.3 University of Southern Denmark Agrees with York Methodology
• 10.4 EU Price Convergence Unlikely
• 10.5 The British Association of European Pharmaceutical Distributors Aim to Deliver Value

Chapter 11. Arguments Against Parallel Trade

• 11.1 Manufacturing Pharmaceutical companies Argument against Parallel Trade
  • 11.1.1 Loss of Profits
  • 11.1.2 Counterfeit Drugs
    • 11.1.2.1 Batches of Two Blockbuster Drugs being Recalled After Counterfeits were Found
• 11.2 The Right to Maximise Returns
• 11.3 LSE Report Showed Negligible Savings

Chapter 12. Parallel Trade: Double Edged Sword

• 12.1 Benefits of Parallel Trade
• 12.2 The Costs of Parallel Trade
• 12.3 Global Growth of Parallel Trade
• 12.4 The Future

List of Tables

• Table 2.1 R&D Expenditure in the UK ($m)
• Table 4.1 Comparative Drug Prices in Selected Developed Countries
• Table 4.2 All Factors that Influence Drug Prices
• Table 4.3 Pricing Differentials for Leading Drugs (30 day supply)
• Table 4.4 Another Example of Differential Pricing (price per pill)
• Table 4.5 Advantages and Disadvantages of Single European Price
• Table 5.1 Difference in Pricing of Selected Drugs
• Table 5.2 U.S./Canadian Price Comparisons
• Table 5.3 Price Per Standard Unit in the US Compared to Canada
• Table 5.4 Price Per Standard Unit of Lipitor in the US and Canada
• Table 5.5 Price Difference in Selected Generics
• Table 6.1 Key Financials for the EU Pharmaceutical Industry ($m), 1990-2005
• Table 6.2 EU Pharmaceutical Trade Balances ($m)
• Table 6.3 Price Per Standard Unit in EU States
• Table 6.4 Price Per Standard Unit of Lipitor in EU States
• Table 6.5 NHS Saving Compared to Parallel Importers' Profit
• Table 6.6 UK Parallel Distributors
• Table 6.7 German Parallel Importers
• Table 6.8 Swedish Parallel Traders
• Table 6.9 Norwegian Parallel Importers
• Table 7.1 Internet Usage World Wide
• Table 7.2 Top 20 Countries in Regards to Internet Usage
• Table 7.3 World Online Drug Market
• Table 7.4 US Agencies and their Authorities
• Table 7.5 Differences between Rogue and Quality Sites
• Table 8.1 Top Ranked Countries where Counterfeits were Seized/Discovered
• Table 10.1 Estimated Total Direct Savings from Parallel Trade in 2002
• Table 10.2 Estimated Direct Savings in 2004

List of Graphs

• Graph 1.1 Global R&D Expenditure and NME output
• Graph 4.1 Incidents in Europe
• Graph 5.1 World Internet Usage
• Graph 5.2 Top 20 Internet Usage Countries
• Graph 5.3 World Online Drug Market ($bn)
• Graph 7.1 European Parallel Trade
• Graph 7.2 EU Pharma Trade Balances
• Graph 7.3 Share of Parallel Imports in Pharmacy Market Sales (%)
• Graph 7.4 Estimated Share of Parallel Imports in Pharmacy Market Sales (%), 2007

List of Figures

• Figure 1.1 Parallel Trading
• Figure 3.1 Cost of Production
• Figure 3.2 Inelastic Market
• Figure 3.3 Elastic Market

Organisations Listed

• Abacist Pharma
• Abit Express
• ACA Mueller
• Acadic
• Ace Pharma
• Actipart
• Alpha Med
• Apothekamed
• Arzneim Pharm
• Beragena
• Bestphago
• Boehringer Ingelheim
• Bios
• Bristol Myers Squibb
• Cancernova
• Cocept Pharma
• Diaprax
• Doc Pharm
• Ecowest
• Eli Lilly
• Farlic
• Gerke Pharma
• Gpp Pharma
• Gruenwald
• GSK
• Holmsland
• Isopharm
• IPM
• Kern
• Kurz
• Logimed
• Lexon UK
• Maximed
• Maxi Pharma
• Medartuum
• Medi Spezial
• Merck
• Mevita
• Naturprod
• Novartis
• Necessity Supplies
• Omna Laek
• Opti Arzeni
• Parallel PH
• Pfizer
• Pharmel
• Pharmpole
• Pharm Dett
• Qdoxx
• Rehaforum
• Sanofi Aventis
• Servo Pharma
• Sigma
• Swingward and Doewlhurst
• Trans Euro Med
• Waymade
• Werner
• Western Pharma